A Comprehensive Look At Detroit

The 8/24/2010 edition of the Detroit Free Press published an article by Mark Stryker that digs into the details surrounding the ongoing, and increasingly entrenched, negotiations between the Detroit Symphony Orchestra (DSO) and their musicians. Stryker’s article focuses on the fundamental issue of musician compensation: its history, current standing, and potential future…

Not unlike other articles about the situation, Stryker includes perspectives from a number of usual suspects, including me. League of American Orchestras president and CEO Jesse Rosen once again espouses a beyond-our-control point of view and that the organization is merely dealing with the aftermath of the economic downturn as best as it can.

But the DSO musicians reject the external pressure argument and point to failings in leadership such as what Stryker summarizes as “unrealistic assumptions in financing the Max [the DSO’s concert hall and music center], now a source of debilitating debt.” According to the article, the players “acknowledge the impact of the recession, but they say poor management has exacerbated the problems. They accuse Parsons’ administration of inadequate fund-raising, pointing to high staff turnover — four vice presidents in charge of fund-raising in four years — as a sign of disarray.”

One aspect Stryker referenced in his article that everyone should note is a recent report from the Ford Foundation which asserts “The facts suggest the only way the DSO can possibly become financially viable is by drastically reducing orchestral costs. Barring such a change, the DSO will probably be forced to close.”

From a professional perspective, the last thing the DSO needs to do at this point in time is make substantial strategic plans regarding the mission, scope, and structure of the institution. Clearly, Detroit is amidst a period of substantial change and although the city is undeniably in a period of decline, the transitional nature of these changes indicates that the outcome is far from known.

Consequently, a recommended course of action includes focusing on securing a mutually agreeable three year contract that manages debt, preserves artistic standards and peer standings, and allows everyone to monitor the economy. If, at the end of that contract, the economy has sufficiently stabilized, the DSO will be in a much better position to revisit restructuring efforts. Of course, that assumes restructuring is even needed.

About Drew McManus

"I hear that every time you show up to work with an orchestra, people get fired." Those were the first words out of an executive's mouth after her board chair introduced us. That executive is now a dear colleague and friend but the day that consulting contract began with her orchestra, she was convinced I was a hatchet-man brought in by the board to clean house.

I understand where the trepidation comes from as a great deal of my consulting and technology provider work for arts organizations involves due diligence, separating fact from fiction, interpreting spin, as well as performance review and oversight. So yes, sometimes that work results in one or two individuals "aggressively embracing career change" but far more often than not, it reinforces and clarifies exactly what works and why.

In short, it doesn't matter if you know where all the bodies are buried if you can't keep your own clients out of the ground, and I'm fortunate enough to say that for more than 15 years, I've done exactly that for groups of all budget size from Qatar to Kathmandu.

For fun, I write a daily blog about the orchestra business, provide a platform for arts insiders to speak their mind, keep track of what people in this business get paid, help write a satirical cartoon about orchestra life, hack the arts, and love a good coffee drink.

3 thoughts on “A Comprehensive Look At Detroit”

The costs due to their expanded facilities are definitely an issue, and it seems a common problem in the cultural sector that an organization has outsize ambitions, builds their Xanadu, but hasn’t run the numbers thoroughly enough to really know what it will cost to keep the lights on.

But I think that’s also indicative of a larger problem for the DSO: the city in which they’re based has the worst economy in the country. The economy is so strongly based on automotive, and even when the Big 3 become fully profitable again, it will never be like the days when they owned the market.

Drew, I appreciate what you’re saying that this is not the time for strategic change – a knee-jerk reaction to present financial problems could really cost the DSO down the line. However, this is a problem that they’ve been facing for many years now, well before the current recession. I think the idea of making small concessions and holding out until things improve will just delay larger changes that need to occur.

Thanks for the insight Darren. No argument here about too many organizations that end up not adequately planning for operating costs associated with capital projects. But assuming that’s the case in Detroit, isn’t that more of an internal problem than external? Likewise, the timing associated with the economic downturn is simply bad timing and if problems are internal then those external forces only augment the results. But they don’t cause them.

Even the DSO’s own statements before the downturn indicated they were on track and making progress. Assuming those statements were accurate and not exaggerated then the organization would be wise to give the situation as much time as possible. But if the internal argument has some root in all of this, then that’s just another reason to believe that solutions may be present.

Ultimately, the DSO may end up exactly where they are now three years from now but if they can manage their debt, and by that I mean not add to the accumulated deficit, then what’s to lose? I do think the players need to trim back the proposed improvements in their proposals in order to help manage the debt over the next three years but that’s what both sides have to agree on. So let’s assume things in Detroit (as a city) continue to decline and three years from now things are no better, or even much worse. The accumulated debt and balloon payments aren’t going anywhere and the DSO can take whatever measures they need knowing full well that there is enough time following the economic downturn that this is where things have to be. Frankly, waiting three years won’t make much of a difference.

But until then, they can see if the area stabilizes and work toward improving governance while retaining their position within the field and serve as an asset to the city in its attempt to recapture lost industry. God knows Detroit needs every tick in the win column it can to make a better future.

Given how little is known about the precise economic situation, the events leading up to this point, etc. it seems as though there are simply too many other options left available. Keep in mind, I have no problem saying stick a fork in it when it’s done; I’ve been saying Honolulu should liquidate for months now. But Detroit just isn’t at that point.

PROFESSIONAL DISCLOSUREGiven the author’s position as an arts consultant and technology provider, he does not publish articles examining or focusing on current clients without first obtaining the client’s written permission.

EDITORIAL COMMITMENT In order to ensure accuracy and provide a comprehensive perspective on any topic, I allow any individual or person officially representing an organization that appears in any Adaptistration article to submit a response which will be published, unedited. Responses are limited to 200 words and must address the issues at hand and the individuals and/or organizations must also be willing to maintain an open dialog for continued discussion.

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